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5 Reasons Why You Should Check Your Credit Report

Do you know what your credit score is? If you answered no, don’t feel bad. Most people couldn’t tell you with any kind of accuracy the number on their credit report, even though it has the potential to impact their lives in a major way. Suppose, for example, that you’ve finally managed to set aside a decent amount of money towards a down payment on a home. However, when you go to a bank seeking approval for a loan, you could discover that ancient black marks on your credit report related to massive credit card debt and a spotty payment history will set you back significantly. Even if you cleared up these issues a long time ago, a failure to check your credit report could mean that they’re still dragging down your rating, leaving you with fewer (and less appealing) options when it comes to taking a major loan. In short, there are plenty of reasons why you should check your credit report on an annual basis. Here are a few that should get you going.

Awareness. If you don’t know what your credit report says you can hardly expect to improve it. And if you want to make any major purchases in the future (a car, a home, a business, etc.) you need to have a top-tier score in order to get the stellar interest rates and other terms that you’re seeking. Your credit score can not only make or break your chances at loan approval, but also your ability to attain rates that you can actually afford to repay. So before you even think about looking for a loan, you should check out your credit report to see if you’ll even qualify.

February 19, 2013

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How To Improve Your Credit Score

A credit score is a numerical figure that depicts the credit worthiness of an individual. The credit score sometimes referred to as a FICO score is used by lenders to judge an individual’s financial health. It is an indication of the risk that you pose to the lender compared to other customers. Credit scores are calculated in a number of ways. The three major credit reporting agencies—TransUnion, Equifax and Experian—use a scale of 300 to 900. A higher score on this scale shows that you pose a lower risk to lenders. Most lenders have set up the minimum credit score that an individual can have to access a loan. Apart from that, credit scores are used by lenders in setting the interest rates. It is important to improve a blemished credit score, as it can deny you a car, home or a personal loan. Below are some things that you can undertake, to improve your credit rating.

1. Credit Report

Most people learn about their credit score when they apply for a loan. It is important to get acquainted with you credit score beforehand, so that you can know if you need to work on it before you go to the lenders. The credit report contains the list of accounts that are lowering your credit score. Get a credit report from the three major credit agencies mentioned above, and determine what accounts are okay, and those that need to be worked on. You can access your credit report online for free from websites such as The AnnualCreditReport.com. You should correct any errors present in the credit report, by providing the right information to the credit agencies, as errors really hurt your credit score. For example, an erroneous late payment can lower your score by 60 to 100 points.

July 18, 2012